Palantir is set to become one of the early leaders of a massive opportunity in the burgeoning artificial intelligence-driven software market, according to Loop Capital. The firm initiated coverage of the software company with a buy rating and $141 price target, which implies 25.8% potential upside after the pullback seen at the tail-end of Wednesday’s trading session. Although the stock is still expensive, analyst Mark Schappel remains bullish on its longer-term outlook. “While we usually don’t recommend paying 44x sales for software companies, we believe Palantir has all the hallmarks (i.e., massive market, category leader, strong execution) of becoming a game-changing software stock along the same lines as Adobe in digital marketing and salesforce.com in cloud,” Schappel said in a Wednesday note to clients. “Palantir is leveraged to the AI (and GenAI) themes sweeping through the tech sector, which are enormous market opportunities likely to create several multi-billion dollar revenue companies,” he added. Shares of Palantir slipped about 10% in the previous session on news that CEO Alex Karp has a new stock trading plan, which allows him to sell nearly 10 million shares of Palantir stock in the next six months, as well a report that the Pentagon has been directed to prepare a list of potential cuts to the U.S. defense budget . Shares continued to trade lower by more than 2% in premarket trading Thursday. That said, Schappel said investors should use pullbacks as buying opportunities. “It’s hard to put a price on the opportunity, so we believe the best strategy is to hold your nose on valuation and just get involved,” he said. PLTR 1Y mountain Palantir stock performance. The analyst mentioned Palantir’s leadership in enterprise AI as a growth catalyst for the company, which is best known for its contracts with defense agencies to provide software and technology services. “There’s room for Palantir to increase more than 5x in size before bumping up against any presumed ceiling,” he said about the enterprise AI business opportunity. The company’s Ontology platform, meanwhile, is its “secret sauce,” according to the analyst. Oncology presents data to users in their own terms, rather than technical database terms, that allows for the successful deployment of AI-driven decision-making. With this product, Schappel said Palantir attracts customers and quickly converts them into playing customers. The investment “picture consists of being exposed to the largest and fastest growing TAM in enterprise software,” he said. Palantir shares have soared more than 48% already in 2025, as the software company has become a favorite among retail investors. The analyst community is generally less sanguine on the stock, however. LSEG data shows that 13 of 22 analysts covering Palantir rate it a hold, while only four have a buy or strong buy rating.
